Category: News

A couple of months ago, Volvo India had inaugurated its first warehouse in India. Located in the outskirts of Mumbai, this new step allows Volvo to prepare for an assault as the company hopes to double its market share in India by 2020. Generally, volumes are inversely proportional to the cost of the car and the launch of the all-new XC40 crossover will help Volvo post some healthy numbers this quarter.

Once that happens, more and more owners of Volvo cars will come to expect a turnaround time for repairs that is comparable to the ‘big three’. The new warehouse will help in that regard. It must be noted that the German carmakers have been around assembling cars in India for much longer while Volvo only commenced operations in October 2017. But, they’re marching forward with a noticeable aggression.

“It has a big impact on our dealers. They’ve done a great job of maintaining a good inventory of parts so far.

Instead of investing a lot of capital and energy into maintaining an inventory, the dealers can expect a better profitability, maybe they can advertise more. Or have the same employees who used to handle the customs paperwork to work with the customers and help them.

If it’s a fast moving part then the dealer will obviously have adequate stock to serve the clients. Everything else they can have it shipped overnight from our new warehouse. This doesn’t sound as exciting as the launch of a new car but it helps the dealers and our customers at the same time. The dealers are definitely very excited about this.”

(The article is written by Mahesh Yadav. He is a car enthusiast and always look forward to new tech. He loves it when a great blend of the two shows up.)

Volvo Cars announced a record 33% growth in volumes in Jan-June 2018 versus last year. The robust sales performance of 1242 units is spearheaded by the XC60 which contributed 25% of the total volume. Successful addition of S90 to local assembly, aggressive network expansion and exemplary brand engagement programs led to the best ever H1 sales performance for the company. The rest of the year looks even brighter with the launch of XC40.

Charles Frump – Managing Director, Volvo Car India shared, “We are extremely happy with our growth pace and intend to keep up the momentum for the rest of 2018. The recently launched XC40 is our first offering in the entry level SUV segment and we expect the XC40 to build a new customer base for us and drive sales.”

The design language of Volvo has evolved enormously and has helped the Luxury Car maker gain higher acceptance amongst its buyers. Internationally renowned for its safety, the cars are now one of the best looking vehicles as well in their respective segment. With the way the OEM has expanded (both in network and lineup of cars); it seems the Swedish Auto major is here to dominate.

The introductory price of the Volvo XC40 is Rs 39.9 lakh ex-showroom for the fully-loaded R-Design variant with a diesel engine. According to the senior officials, this pricing is not sustainable so a revision is expected soon. The timeframe for the price hike is not decided yet and neither is the final price tag that’ll make this crossover profitable for the company.

Impossibly Affordable

For now, Volvo appear to have put their margins on the line as there’s no way the XC40 can undercut its locally-assembled rivals while being a CBU import. Local assembly will help cut those losses while a price revision will make it profitable. But, all that will depend on the volumes this crossover can bring in. Volvo may even speed up to get the local assembly commenced if the demand justifies. The local assembly of the XC60 will begin this quarter and, given the strong demand for SUVs and crossovers, we believe the XC40 won’t stay on the CBU path for long.

The compact luxury SUV segment is said to be the most lucrative of all churning out ~6,000 units per year in India. That’s a big pie and even a small slice of that will result in a sizable growth for the Swedish carmaker.

Flexible Frame Can Take A Variety Of Powertrains

The newest Volvo stands on the brand new Compact Modular Architecture platform — CMA for short. Just like the bigger SUVs’ SPA platform, this one is capable of accommodating a petrol engine, a diesel engine, or a petrol-hybrid engine with front-wheel drive as well as all-wheel drive. This will allow them to rapidly deploy hybrids should the need and/or demand arise.

New Parts Warehouse

Along with their most affordable luxury crossover, Volvo also announced that they now have a warehouse for spares in India. This will result in faster turnaround times for customers. At the same time, it benefits the dealers as they no longer have to worry about:

1. locking up their capital

2. holding the spares onsite

3. dealing with the customs and paperwork

New Dealerships This Year

By the end of this year, Volvo will have 5 more outlets, thus helping them expand their reach and add more customers to the Volvo family. The manufacturer has witnessed steady growth, both, in India and worldwide, since the redesigned models started hitting the showrooms. The trend is expected to continue as XC40 makes the brand even more accessible for buyers looking to stand out. The manufacturer delivered 5,71,577 units worldwide in 2017. With 3,17,639 models already moved this year, it looks like a target of 6.5 lakh units for 2018 is very much within reach.

Here’s a gist of XC40’s notable features:

– Biggest footprint in its class

– Boxy proportions for a rugged SUV look

– Best-in-class power and torque (190hp/400Nm)

– All-wheel drive is standard (Sourced from Haldex)

– Only diesel engine for now

– 8-speed automatic (Sourced from Aisin)

– Radar-based safety features

– Traffic sign recognition and warning if you exceed the speed limit

– Automatic full emergency braking

– Large animal detection

– Adaptive cruise control (maintains a safe distance from the vehicle in front and moves automatically; no acceleration of braking input required

– City traffic assist (Automatically manages the acceleration and braking at low speeds)

– Lane keep assist

– Semi-autonomous driving (On well-marked and open stretches of road, the XC40 can drive for short durations without requiring any driver inputs, not even for steering)

Hatches win matches! – Yes, this rule holds true in the Indian Automotive space for the OEMs. Maruti has been successful with this strategy since day 1 and is still holding it’s fort. Even Hyundai has grown to this proportions with the success of its erstwhile Santro (which is planned to be relaunched), i10/Grand. Renault’s baby Kwid did big wonders to the company and even Tiago has elevated Tata to the No.3 Spot in the Top OEMs!

Let’s see how the hatches fared in June’18 –

Best selling hatches of June’18

Swift overtook Alto sales by over 100 units and was also the second best selling car of June’18

Grand i10 has now become the third best selling Hyundai and sells lesser than Creta/i20!!!

Tiago’s YoY growth was an impressive 53% and it’s evident that the hatch is more accepted than its rivals Celerio/Kwid.

Premium Hatchback Sales in June’18 –

Baleno with a YoY growth of 97% is the undoubted champion in the segment

i20 stands the test of time and still easily sells >10k units per month

Polo has now become an enthusiasts car and the numbers are limited accordingly

Jazz facelift is expected to be launched in July’17. Can it work wonders similar to the New Amaze?

Cross-Hatch sales in June’18 –

It is now a virtually dying segment and the volumes are consistently sloping down. However, Ford has made a bold move with Freestyle and what works for Freestyle is the ‘pricing’. Hope it continues to do more than 2.5k units average/month to sustain itself.

MUV sales in June’18 –

The most expensive offering in the segment is also the Best selling car in the segment! It is seldom this kind of scenario is seen in any category. However, only Toyota has the mettle to do so!

New Ertiga launch is on the cards and shall improve the sales even further for the marque.

Hexa sales is well below 1000 nos and is not as expected by the brand.